Where is the craft beer market heading?

New brewery owners Andrew Leichthammer of Good Measure Brewing in Northfield and Mark Babson of River Roost Brewing in White River Junction offer their views on the craft beer market in Vermont.
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Andrew Leichthammer, partner and head brewer of Good Measure Brewing in Northfield.(Photo: JEFF BAKER/for the FREE PRESS)

The American craft beer market is entering into a certain stage of maturity. Breweries are starting to use more analytic tools to gauge their success, the success of their competition and to try to make educated guesses about where the beer market is going.

And, as craft beer becomes more of a business and less of a club, there are dozens of articles published every month that point to the growing dark cloud hovering above craft beer. There’s no such thing as endless growth and brewery owners are starting to batten down the hatches against the strengthening wind of increased competition.

Most of these articles are written by industry experts who are quoting the veterans of the movement once called “microbrew:” Jim Koch of Boston Beer Company, Ken Grossman of Sierra Nevada and Garrett Oliver of Brooklyn Brewery are often turned to. All of these men were the forefathers of craft beer. They were the innovators. They were the risk takers. And based on their experiences, they can provide us with a valuable, 30,000-foot view of the beer market.

But I wondered: What if we took a look at the beer business from the view of brand new boots in a brand new brewery? What does this market look like to brewers who just opened up their first brewery? Maybe they are seeing the world in a totally different light. Or at the very least, from a different angle.

So to get this perspective, I turned to Andrew Leichthammer, partner and head brewer of Good Measure Brewing in Northfield and Mark Babson, owner and brewer of River Roost Brewing in White River Junction. I asked them, via email, how they saw the beer market, starting first with challenges that are affecting them directly.

Leichthammer, who has been a home brewer for over 10 years and just went pro when he opened Good Measure late last year, noted that access to ingredients has been a real struggle. “While grain has never been an issue, I have been struggling with the purchase of hops,” he wrote. “Every brewery is making hop-forward beers and with 3,000+ breweries all fighting for the same hops, certain varieties are incredibly hard, if not impossible, for us to get.” Small size breweries can’t muscle their way into trendy hops the way that larger breweries can. Ingredients will likely be a major problem for small breweries across the nation.

"The biggest challenges for me have been with the business side of owning/running a brewery,” Babson wrote. He started home brewing before he could legally drink a beer and took a professional job working for Magic Hat in 2009. Then he did a short stint at Woodstock Brewery in New Hampshire before opening his own brewery. River Roost opened a year ago, and Babson is the sole employee. “It can certainly be a juggling act.” He says that brewing the beer is his focus, but things like updating his website and social media and answering the phone or emails sometimes get put on the back-burner.

Then I asked, what trends do you see in the Vermont beer market?

Babson pointed to the “juicy and hazy” Vermont IPA style that sprang up in the Green Mountain State and gleefully agreed that he’s participating in the trend. “It’s what I enjoy myself," he said.

Leichthammer sees something different: A return to brewing with locally-grown ingredients. “Just as the eat local movement started years ago, the beer movement is starting to head in the same direction. We connect with local farmers to receive grains, fruits, vegetables… I try to incorporate these things in as many of my beers as possible.”

CLOSE

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Personally, I see this trend as an extension of how Vermonters have always embraced brewers with the same warmth as they do farmers. Beer is produce, and Leichthammer is pushing the envelop of what it means to be considered "local beer." Vermont’s northern climate and short growing season can pose challenges for brewers who want to brew local, but as the old adage goes, where there’s a will there’s a way.

“I see the market becoming more localized,” Babson said when I asked him about where he sees the national beer market headed. I have industry colleagues who echo this sentiment around the water cooler. That data I mentioned earlier indicates that the largest breweries in the country, the ones which distribute their beer in every state, are losing market share to local breweries.

Will mid-sized breweries be squeezed out?

“There will be a place for the larger craft breweries and the smaller ones. I see the ones in the middle feeling it the most," predicted Babson. The big brewers are fairly well insulated against market fluctuation, and the little breweries are enjoying the benefits of the drink-local trends in their home markets. But the midsize breweries, the ones with lots of debt and few liquid funds? Well, they are in the most danger of going out of business, or being bought out by another firm. (This is part of that dark cloud I mentioned earlier.)

But not all new breweries will make it either. Leichthammer sees “lots of breweries opening that probably won’t make it through a year or two.” He points to quality as the deciding factor of who will make it and who will not.

When I posed the same question to Babson, he said nearly the same thing: “The number of breweries will continue to rise but I believe we will see more closing due to quality. Quality has been of constant concern in the craft industry and I believe people are now more educated consumers.” As the market becomes more crowded, being local won’t be enough to ensure success.

So what about national brewing trends?

Mark Babson, owner and brewer of River Roost Brewing in White River Junction.(Photo: JEFF BAKER/for the FREE PRESS)

Both of them see sours and low-alcohol beers trending pretty hard right now.

“Fruited Goses, Berliner [Weisses and] kettle sours,” wrote Babson. He’s not placing any bets that sour beers will ever dethrone the mighty IPA, and he’s not planning to brew any himself. But he’s not closing the door on it completely. “I also see a trend toward quality, complex, flavorful low-ABV ales and lagers. I feel that this one has been on a long slow steady rise for many years.”

What’s clear from talking with both of these brewers is that they’ve put a lot on the line to pursue the dream of owning their own brewery. The fear, anxiety and excitement that they are experiencing is echoed from top to bottom in the beer industry. No matter how large a craft brewery gets (I’m using this term in the way that the Brewers Association defines it), the owners are on the hook if anything goes wrong or if the market tanks. And it’s clear that both of them take their profession very seriously and have done their market research before diving into the deep end.

The other great thing about interviewing people who have just opened their own brewery? They’re super stoked to be doing what they love. When I asked Babson if there are any trends he’d like to see go away, he said, “I tend to like them all… What’s next?”

Jeff S. Baker II is the Curator of the Curriculum for Farrell Distributing. You can find him on Twitter and Instagram @aPhilosophyOf. Jeff co-hosts the “It’s the Beer Talking” podcast found on iTunes and Soundcloud. More info at www.burlingtonfreepress.com/news/podcasts​.